Under a Flexible Exchange Rate,an Increase in the Domestic Money

question 17

Multiple Choice

Under a flexible exchange rate,an increase in the domestic money supply leads to

• A) a devaluation of the domestic currency.
• B) a revaluation of the domestic currency.
• C) a depreciation of the domestic currency.
• D) an appreciation of the domestic currency.
• E) the real interest rate increasing.

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